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New advertising rules come into force 6 April 2009

Amendments to the insolvency rules mean that revised insolvency advertising procedures will apply to nearly all new insolvency cases starting on or after 6 April 2009.

The aim of the changes is to achieve better targeted publicity in insolvencies. Insolvency office-holders and others with a duty to advertise will still need to advertise key insolvency events in the London Gazette but will then be free to decide whether any extra publicity is necessary and, if so, to choose the most efficient and effective approach.

Newspaper advertising in addition to the London Gazette will no longer be necessary – a welcome move, as the costs of this can run into hundreds of pounds, to the detriment of creditors – which opens up the potential to use the internet, radio or even television if these are considered the best way to reach the target audience.

However, the Insolvency Service does not expect wider advertising to be used routinely in what it calls “run of the mill” cases.

Now Freddy Khalastchi, a partner at London chartered accountants and insolvency specialists Harris Lipman, has highlighted another cost-effective publicity tool.
He says: “As most educated creditors and professionals tend to check Companies House when looking to find out information about a company, does it not make sense to file adverts with the Registrar instead?

"This avoids the problem of practitioners having to decide for themselves and brings the insolvency event to the knowledge of the public at large, who will at least know where to look. The credit reference agencies will then also help to spread the word to their customers.”

He has put forward the idea to the Insolvency Services Policy Unit, receiving a response from the unit’s Neil Ogilvie saying that it will “consider any practical issues which are seen to arise in the months following implementation”.

Freddy Khalastchi said: “It seems that these new measures may still be a work in progress so it would certainly be worth insolvency professionals feeding back their experience of the new regime over the coming months, with the aim of further improving the new advertising arrangements.”

What are your thoughts on the current advertising rules?  Leave a comment below.

 

 

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